Eminent domain allowed

Judge favors TransCanada in dispute over access to land in Marshall, Day counties for pipeline

Judge favors TransCanada in dispute over access to land in Marshall, Day counties for pipeline

May 15, 2008|By Scott Waltman, swaltman@aberdeennews.com

It was necessary for Trans- Canada to use eminent domain to gain access to land it needs to build an oil pipeline, a judge ruled Wednesday. The decision comes after a two-day hearing on the subject last month in Britton. TransCanada has shown that the pipeline meets the definition of “public use,” in that it will help meet the growing demand for oil in the United States, Judge Jack Von Wald ruled. “A common carrier may exercise the right of eminent domain in acquiring right of way as prescribed by state law,” he wrote. Furthermore, the company didn't engage in fraud or bad faith, nor did it abuse its power, Von Wald ruled. TransCanada plans to build a pipeline that would pump crude oil from the Canadian province of Alberta about 2,200 miles to refineries in Illinois and Oklahoma. It would cut through 10 counties in eastern South Dakota, including Marshall and Day. Eminent domain gives a company or utility the right to use land in return for payment, even when easement agreements can't be reached. It does not transfer ownership of land. Owners of 10 tracts of land in Marshall and Day counties made several arguments as to why they thought TransCanada had acted inappropriately in trying to gain easements to build the Keystone Pipeline: Pipe thickness: TransCanada was granted a permit from federal regulators to use a slightly thinner pipe than it otherwise would have been allowed to. Von Wald wrote that the state Supreme Court has defined bad faith as “conscious wrongdoing motivated by improper interest, ill will or dishonest intent.” There is no evidence of that in TransCanada's decision concerning the thickness of the pipe, he said. Route: Landowners argued that a route to the east of the one planned would be safer. But, Von Wald wrote, there was conflicting evidence about that at a Public Utilities Commission hearing. The Supreme Court gives “great latitude” to a business or agency with the authority to condemn land, and TransCanada did not abuse its discretion, Von Wald ruled. Negotiations: TransCanada presented offers to all of the landowners, and state law does not require easement negotiations before condemnation, so the company did not act in bad faith, the judge wrote. Multiple pipelines: While Von Wald found that the company should amend easements “so there is no question that the documents could be legally interpreted to permit multiple pipelines,” he said there is no evidence of fraud. Easement conditions: Some landowners wanted easement conditions to control items ranging from site cleanup to construction during wet conditions. But, Von Wald said, TransCanada's construction mitigation plan covers many of those concerns and guidelines set by the PUC govern others. TransCanada “has not abused its discretion in imposing its easement terms,” Von Wald wrote. With the decision, the next step in the condemnation is a series of trials to determine the value of the easements. They are set to begin June 9 in Marshall County.